Walt Disney rescues Euro Disney with $1.3 bln funding deal

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The Colonel's picture
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Walt Disney rescues Euro Disney with $1.3 bln funding deal

Market Update: The Walt Disney Company (NYSE:DIS) " Walt Disney rescues Euro Disney with $1.3 bln funding deal
By Stuart Aton, on October 6th, 2014, 7:13 am in Services
The Walt Disney Company (NYSE:DIS) [Reuters - UK Focus] " Walt Disney Co has come to the rescue of its loss-making subsidiary Euro Disney with a 1 billion-euro funding deal announced on Monday, which could give the U.S. group total control over Europe's biggest ...
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The Walt Disney Company (DIS), currently valued at $152.88B, opened at $88.78.

Looking at the stock, its one day range is $88.64 to $89.17 and has traded between $63.10 and $91.20 over the past year.

Priced at 20.57x this year's forecasted earnings, DIS shares are relatively expensive compared to the industry's 5.76x forward p/e ratio.

And for dividend hunters, the company pays shareholders $0.86 per share annually in dividends, yielding 1.00%.

According to a consensus of 29 analysts, the earnings estimate of $0.88 per share would be $0.11 better than the year-ago quarter and a $0.00 sequential decrease. In looking at the bigger picture, the full-year EPS estimate of $4.30 would be a $0.91 better when compared to the previous year's annual results.

The quarterly earnings estimate is based on a consensus revenue forecast of the current quarter of $12.36 Billion. If realized, that would be a 6.83% increase over the year-ago quarter.

More recently, Barclays Initiated DIS at Equal Weight (Jul 9, 2014). Previously, Topeka Capital Markets upgraded DIS from Hold to Buy.

When considering if perhaps the stock is under or overvalued, the average price target is $94.32, which is 6.24% above where the stock opened this morning.

Summary (NYSE:DIS) : The Walt Disney Company operates as an entertainment company worldwide. The company operates in five segments: Media Networks, Parks and Resorts, Studio Entertainment, Consumer Products, and Interactive. The Media Networks segment operates broadcast and cable television networks, domestic television stations, and radio networks and stations; and is involved in the television production and television distribution operations. Its cable networks include ESPN, Disney Channels Worldwide, ABC Family, and SOAPnet, as well as UTV/Bindass. This segment owns eight domestic television stations. The Parks and Resorts segment owns and operates the Walt Disney World Resort in Florida that includes theme parks; hotels; vacation club properties; a retail, dining, and entertainment complex; a sports complex; conference centers; campgrounds; golf courses; water parks; and other recreational facilities. This segment also operates Disneyland Resort in California; Disney Resort& Spa in Hawaii; Disney Vacation Club, Disney Cruise Line, and Adventures by Disney; and Disneyland Paris, Hong Kong Disneyland Resort, and Shanghai Disney Resort, as well as licenses the operations of Tokyo Disneyland Resort. The Studio Entertainment segment produces and acquires live-action and animated motion pictures, direct-to-video content, musical recordings, and live stage plays. The Consumer Products segment licenses trade names, characters, and visual and literary properties to retailers, show promoters, and publishers; publishes entertainment and educational books, magazines, comic books; and operates English language learning centers. This segment is involved in the retail and online distribution of products through the Disney Store and DisneyStore.com. The Interactive segment creates and delivers entertainment and lifestyle content across interactive media platforms. The company was founded in 1923 and is based in Burbank, California.

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I saw that Disney came to the rescue... again.

I wish that I could say that I was surprised, but I never hear a lot of wonderful news coming out of Disneyland Paris and I don't really think that letting it fail is an option at all.

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Well its good that Disney has total control now. Problem is they put it in the wrong country. I'd like to see it if airfares weren't so stupid high.

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Personally Colonel Florida is so much better, except for Tower of Terror which is fab in Paris. It is expensive for us to visit and we live in London so can get the train across. It was cheaper for us to come to the US for a week in June than go there. There are some great places to eat and they have EoS but that's it eeally

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Sally-Ann wrote:
It was cheaper for us to come to the US for a week in June than go there.

eek Wow, that's crazy

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Sally-Ann wrote:
Personally Colonel Florida is so much better, except for Tower of Terror which is fab in Paris. It is expensive for us to visit and we live in London so can get the train across. It was cheaper for us to come to the US for a week in June than go there. There are some great places to eat and they have EoS but that's it eeally

I was thinking of hooking it up with a couple of days of city touring and cross it off the bucket list. But with the way it is in France right now, I may want to wait for better times.

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Yep it's mental, I live just west of London. Even driving over to Paris, and going to an offsite hotel for 2 of us the lowest we get it to is PS850 for a long weekend

Staying onsite and driving with meals we budget PS1000 for Friday - Monday. That's overnight driving on Thursday night, Friday, To Monday in the parks and more overnight driving home

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I've been reading some stuff searching through Google about the whole thing and well, from what I've read, Disneyland Paris was a tough sell from the start and it's the second time in the last three years they've done a bailout. There are some parallels that can also correlate to Walt Disney World but obviously, Europeans are a resonating demographic in terms of WDW international visitors and WDW's financial situation is miles beyond of what it is in Paris.

Aside from Tokyo Disneyland, it seems to me that the other international parks aren't holding up very well financially. Granted, the global economy isn't very strong with Europe being hit hard and Hong Kong Disneyland has made changes for the better with Mystic Manor and they'll be adding an Iron Man attraction two years from now but how is Hong Kong Disneyland going to hold up when Shanghai Disneyland opens? As for Disneyland Paris, is the bailout just delaying the inevitable closure? Hard to say but it's not looking good right now.

One of the articles I read that provides some explanation on the whole thing:
http://rt.com/op-edge/193864-disney-france-bailout-amusement-park/

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With all those visitors, why doesn't it make money? Are the operating costs that much higher? It is the number one tourist sight in Europe. 14 million visitors a year isn't enough? Universal Studios makes money with 7 million visitors. Has to be mismanaged.

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I definitely want to see DLRP, but first, DL, Disney Cruise, and probably Adventures by Disney. So many vacations, so little time (and money LOL).

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The Colonel wrote:
With all those visitors, why doesn't it make money? Are the operating costs that much higher? It is the number one tourist sight in Europe. 14 million visitors a year isn't enough? Universal Studios makes money with 7 million visitors. Has to be mismanaged.

I think location plays a big part in it. Weather wise, it's not as favorable compared to Disney World, Disneyland in California and even Tokyo Disney has better weather. Who wants to go to a theme park with frigid temperatures and more than frequent rainfall during the winter? Most would decline that offer. And people who come to Paris or visit France in general usually don't have Disneyland Paris on their plans. If they do, it's probably a one-day trip only or at most, 3 days-2 nights there and they're probably not going to spend their nights at the Disneyland Paris hotels because it's too much hassle doing a split stay from a hotel in the heart of Paris to a Disneyland Paris hotel. (DLP is 20 miles outside of Paris.)

France, Italy and Spain, three of the biggest countries where most of the Disneyland Paris visitors are from, are all facing financial problems so consequently, people are cutting back on spending. Still, the biggest reason I've read is it's failing primarily because of their 2.2 billion dollar debt from its costs and the park hasn't made profits. I mean, 7 onsite hotels that opened at the same time as Disneyland Park in Paris? Complete overkill and a complete overestimation. Still, the 1.3 billion bailout subtracted from their supposed debt means they're still roughly a million dollars in debt.

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"All my life I wonder how it feels to pass a day, not above them but part of them.

And out there living in the sun, give me one day out there, all I ask is one to hold forever. Out there where they all live unaware, what I'd give, what I'd dare, just to live one day out there."